While the move strengthened Founders Bank's ties to GE, it also has another benefit, according to William L. Gunlicks, chairman of the $103 million-asset bank headquartered in the resort community of Naples.

GNA was an established player in the affluent market. The company's sales representatives had been selling $70 million a year through Bank Florida in Naples, but lost the contract recently when First Union Corp. bought the bank.

Mr. Gunlicks said that while he was happy with Independent Financial, the bank was too small for a company that didn't already have the solid local book of business that GNA had.

Because GNA already serves investors in the Naples area, it was able to commit three sales representatives to Founders Bank's effort, up from one under the bank's previous arrangement.

In part because of the switch--a month was gobbled up just in re-registering the sales program--mutual fund sales for 1994 are falling short of the projected $6 million, Mr. Gunlicks said.

But Mr. Gunlicks said he hasn't lost any zeal for the program. The sales slump was largely a function of the market downturn, he said. Mutual fund sales have already heated up to a $12 million annualized clip, and "the season" is just about to begin.

The sales season, in Mr. Gunlicks' experience, runs from November to May, when the part-year residents known as "snowbirds" flock to Florida. Their stay coincides with tax time, ensuring that many of Founders Bank's clients handle a sizable chunk of their financial affairs in Florida.

With the business preliminaries behind, Mr. Gunlicks is looking for Founders to have a solid year in alternative investments.

He predicts investment product sales of $12 to $15 million next year.

Growing a new business isn't something Founders is uncomfortable with--the bank itself opened for business in January 1992.

The investment program kicked off this January. Soon after, GE and the bank began a joint advertising campaign in local newspapers introducing the funds as "mutual funds from a name you know."

The advertising campaign continues, Mr. Gunlicks said, but the bank has learned that the two best marketing techniques are investment seminars and internal referrals.

The bank, sensitive to the tennis and golf schedules of its clients, typically holds seminars at 4 in the afternoon.

This year, representatives from GE and fund companies including Franklin Resources and Van Kampen Merritt have conducted sessions on special topics such as investing to finance a child's college education.

Of the 50 people who turn up at the typical seminar, about 10 will make followup appointments with the bank, Mr. Gunlicks said. About five of those people will make purchases.

"It's more of a classy way to market," he said. "You end up with a lot of referrals."

After visiting a seminar, Mr. Gunlicks said, one 70-year-old woman bought mutual funds for her two children and her two grandchildren.

The bank is also focusing on building its internal referrals, Mr. Gunlicks said. To do that, it gives $10 to anyone who refers someone to a sales representatives, he said. In addition, a letter recognizing those making referrals is circulated around the bank.

Turning referrals into sales has be a little tougher with the market's poor performance, but Mr. Gunlicks says it's a plus that consumer financial publications stress investment performance.

"I think it's healthy anytime you can educate the consumer about risk," he said. "It's heightened the public awareness that there can be a loss in mutual funds."

Founders, which was started as a private bank to serve affluent clients, sees investment products as one more way to meet customers' overall financial needs, Mr. Gunlicks said. Therefore, the bank tries to build on the relationships not to make product sales.

Founders has 10 private bankers on staff, four of whom hold mutual fund sales licenses. Those bankers feel free to talk about the offerings before passing the customers along to the sales representatives.

"The private bankers kind of pitch the first or second inning," Mr. Gunlicks explained.

"It's so important that your personal bankers are able to assist the representatives from the third party firm so that you don't get into a situtation where the mutual funds and annuities are necessarily competing with deposits," Mr. Gunlicks said.

When the GNA representative takes over, a typical sales ticket is $25,000. About 60% of the sales are in mutual funds and the rest annuities, Mr. Gunlicks said.

Mr. Gunlicks would like to see more annuities sold in the future. He said private bankers and customers are more readily drawn to mutual funds which they better understand.

Mr. Gunlicks said he is pleased with GNA on board.

"GNA has significant resources both on the annuities and the mutual fund side," Mr. Gunlicks said. "Now we're really starting to roll in our customers and prosper," he said.

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